Consumer groups have issued a 10-point plan they say will address flaws in the proposed updated General Insurance Code of Practice.

The plan, from 10 organisations, targets claims handling gaps that emerged after the 2022 floods and is part of a wider submission voicing disappointment at the redrafted code.

“There is much to be done to improve upon the redraft currently being consulted on,” the submission said. “But at a minimum, the general sector needs to commit to the [10-point plan] in a final version of the code.”

The consumer groups say they welcome new code protections including strengthened requirements for primary points of contact and cash settlements.

However, other planned changes would lead to consumer detriment, according to the submission.

While insurers have committed to contractual enforceability, there are exceptions in the redraft that undermine the code’s enforceability, it says.

The submission also says the two-year transition being proposed is unacceptable.

“That would mean consumers would have had to wait over five years since the beginning of the code review or a full seven years after the failed insurer response to the 2022 east coast floods ... to obtain new protections,” it said.

“Consumers should not be subject to further delay. At maximum, insurers should be provided with a 12-month transition.”

Financial Rights Legal Centre – one of the groups that prepared the submission – says its analysis shows insurers have either watered down or walked away from 65 consumer protections in the current code.

“It’s simply not good enough,” the centre’s policy development principal Drew MacRae said.

He says the 10-point plan can help address the industry’s “trust deficit” with consumers.

“Government intervention may be needed if general insurers once again fail to meet the moment and act on this 10-point plan to strengthen the flawed redraft.”

The Insurance Council of Australia insists the proposed code “raises the bar” for consumer protections.

“The redrafted code will be contractually enforceable … It enhances support for people experiencing vulnerability …  and lifts the standard of care people can expect when they make a claim,” a spokesperson told insuranceNEWS.com.au.

“Some provisions have been redrafted in practical terms, setting out precisely what insurers will deliver so consumers can hold them to it.

“Every one of these changes raises the bar for consumers, today and into the future.”

See the submission here.